Fracking fluid blows out nearby well

Cleanup costs, competing technologies at issue

KASA | Tina Jensen

COUNSELORS, N.M. (KRQE) - More than 200 barrels of fracking fluid, oil and water blew out of a traditional oil well on BLM land in the San Juan Basin in late September raising questions about who is responsible for the spill.

State regulators say the blowout on a Parko Oil well happened because of pressure from nearby fracking operations run by Encana Oil.

Fracking--short for horizontal fracturing--is a controversial practice that uses chemicals pumped under pressure to break up underground layers of shale to release oil and natural gas.

"The spill has been contained," said Jim Winchester, spokesperson for the New Mexico Energy, Minerals and Natural Resources Department, which houses the state regulator Oil Conservation Division. "Fluids from the spill were removed by a vacuum truck quickly after the release."

On Sept. 30, one of Encana's fractures reached Parko's neighboring vertical well. The pressure was too much for the older well to handle.

"Our highest pressure is around 150 pounds," said Parko Oil pumper Johnny Aragon. "The pressure we were experiencing was in excess of 2,000 pounds, which is a lot more than what the wells are designed to hold."

Encana's operations were approximately 0.5 miles from the Parko well that had the blowout.

"An Encana well, undergoing stimulation operations, may have communicated with the well of a nearby operator," said Encana spokesperson Doug Hock. "That operator's well became over-pressurized resulting in the release of fluid from both the wellhead and a nearby tank."

"When Encana was made aware of the situation, it immediately ceased its own operations."

Well Spacing Concerns

The San Juan Basin is considered one of the largest natural gas reserves in the world. But with natural gas prices so low, many energy companies are making a play for oil.

"Many of the drilling rigs that are now operating in the San Juan Basin are exploring and drilling in parts of the basin that have the potential for oil and high levels of natural gas liquids as opposed to dry gas," said Wally Drangmeister of the New Mexico Oil and Gas Association.

New wells are springing up quickly.

Some fracking operations are installing wells as close as 800 feet from traditional vertical wells.

"I don't understand why the state or the BLM or anyone else is letting them get so close to other wells," said Floyd Parker, president of New Mexico-based Parker Oil. "Encana's encircling our field entirely."

New Mexico has no standard minimum spacing requirement between wells.

Some experts warn New Mexico could be facing huge problems ahead with the close proximity of high-pressure fracking operations and aging wells.

"Other states have modified their rules to require, for example, that an operator intending to drill a horizontal well would have to identify all older wells within a certain distance from the route of the horizontal bore," said Bruce Baizel, energy program director for Earthworks.

But Drangmeister says he doesn't believe the proximity of the Encana and Parko wells caused the blowout.

"From my understanding of these very rare cases of well communication, the issue is one of local underground geology, not spacing or the age of wells," he said.

Environmental Questions

The Encana-Parko well hit resulted in soil contamination but no groundwater pollution, according to the state's Oil Conservation Division.

But there's a big risk when fracking fluid meets up with a traditional, aging well.

Fracking fluid includes water and toxic chemicals. Some chemicals are disclosed, but in New Mexico the OCD doesn't require the reporting of "proprietary, trade secret or confidential business information."

Encana declined to give a full list of the chemicals involved with this spill, but said nitrogen is used in their operations.

Even Parker says aging wells are prone to cracks. If fracking operations hit one of those wells, it could have devastating consequences, he said.

"If you had a crack in your casing or something like that, their fluid may go into the water reserve," he said.

Baizel says it's a real possibility.

"The scientific research shows that all wellbores and their cement eventually degrade and leak; it's just a matter of time," he said. "We also know that older wells were subject to less stringent standards at the time they were drilled, so that also adds to the potential for leakage."

Drangmeister said he couldn't speculate on whether cracks in aging wells could pose a risk for groundwater contamination.

"I can say that a regulatory structure has always been in place in New Mexico for well construction and cementing," he said.

The Cost and Responsibility of Cleanup

The half-mile stream of chemicals and soil contamination from the blowout was left for Parko to cleanup.

"The release was on their well," Hock said. "They took charge of the cleanup and shut-in of their well."

So far, Parko Oil has had to pay for the cleanup, too.

Parko Oil president Floyd Parker estimates current damages at $100,000 and says this isn't the first time Encana's operations have impacted his own.

"They said they'd pay the bills," he said. "They haven't paid any of the bills, and they haven't paid anything on this mess either."

State oil regulators don't have the authority to say who should pay for these messes, so the companies have to work it out, or go to court.

KRQE News 13 asked Hock who must take responsibility for the cleanup and pay for it during an incident like this.

"I don't know the specifics of this," he said. "However, I can tell you that in this case, Parko took charge of the cleanup."